The Line Item Veto Act and the Limits of Executive Power

On April 10, 1997, as this article was being prepared for printing, the United States District Court for the District of Columbia granted summary judgment to the plaintiffs in Byrd v. Raines. The court struck down LIVA because the statute purports to confer on the President the power to rescind otherwise valid laws. The court concluded that such a power was inconsistent with the division of powers under the Constitution.

In the course of the last twenty years, Congress has adopted a series of procedures intended to bring the federal budget deficit under control. Each of these schemes has in common a profoundly pessimistic view of the ability of Congress and the Executive to balance the budget the old fashioned way, i.e., by having Congress vote a balanced budget or by having the President veto budget-busting bills as they are presented to him. Instead, these schemes have sought to take the issue of deficit reduction out of the normal political process and create instead procedural devices to "force" a balanced budget. The problem with each of these devices is that they are, by their nature as legislative acts, not binding on the Congress that created them, let alone future Congresses. They are waivable by a simple legislative act, and past Congresses have found it all too easy to waive them. These special procedures calls to mind a drunk who, resolving to go on the wagon, locks his liquor cabinet and confidently sticks the key in his vest pocket. His sobriety will last only until the next time he feels the need for refreshment.

These attempts may not have created a balanced budget, but they have made some interesting constitutional law. In Bowsher v. Synar, 478 U.S. 714 (1986), Chief Justice Burger writing for the Court held that a scheme that placed essentially executive decisions regarding sequestration of appropriated funds in an officer of the Legislative branch--the Comptroller General--violated the separation of powers under the Constitution. This landmark decision defined more clearly than prior cases the separate spheres of executive and legislative action.

In the Line Item Veto Act, Pub. L. No. 104-130, 110 Stat. 1200 (1996) ("LIVA"), Congress has taken a new approach to the perplexing budget problem. Like prior statutes, LIVA attempts to distance Congress from responsibility for balancing the budget. Instead of attempting to limit accountability by creating procedural straight jackets or relying on unelected bureaucrats to make "automatic" budget cuts, LIVA dramatically increases the power of one branch--the Executive--to cut spending and eliminate special tax provisions.

LIVA became effective on January 1, 1997 and will sunset on January 1, 2005. Under this statute, the President may "cancel" any dollar amount of any appropriation, any item of new direct spending, or any special tax provision creating tax breaks for 100 or fewer taxpayers. The President may consult legislative history and other sources to identify the particular line item amounts contained in larger spending bills to be canceled. Thus the President, upon being presented with a special or omnibus bill directing the expenditure of a lump sum of federal funds may look to committee reports, managers, statements, etc. to identify the line items to be canceled. LIVA provides only three (remarkably general) factors to guide the President in his decision to cancel a budget item:

Whether the cancellation will reduce the Federal budget deficit;

Whether the cancellation will impair any essential Government functions; and

Whether the cancellation will harm the national interest.

Cancellation is accomplished by notice to Congress that must be given within five days after the President has signed the relevant bill. Congress may then "disapprove" the cancellation by enacting a "disapproval bill" which would then be presented to the President for his signature in accordance with Article I, Section 7 of the Constitution. If the President vetoes the disapproval bill, Congress would have the opportunity to override the veto by a two-thirds vote of each house in accordance with the Veto Clause.

Like its predecessors, LIVA promises to make new and interesting constitutional law. Indeed, three sitting Senators and two members of the House (together with one former Senator) filed an action earlier this year to enjoin LIVA. A decision in that case is expected soon. The statute further provides for a direct and expedited appeal of a district court judgment to the Supreme Court.

Ultimately, LIVA's constitutionality must turn on whether the powers it grants to the President to cancel all or any portion of a spending or tax that has otherwise been duly enacted are consistent with the Constitution. A mere statute cannot grant to the President a power that is inconsistent with his role under the Presentment Clause and with his fundamental duty to ensure that the law is faithfully executed. The President cannot by statute be permitted to usurp Congress' role in legislative process any more than Congress can usurp executive functions.

Viewed in this context, the President's powers under LIVA must logically be viewed either as part of the process by which legislation becomes law (in which case they must comport with the Presentment Clause) or as part of the President's executive powers (in which case they must be executive rather than legislative in nature). LIVA falls between those stools.

The Constitution gives the President three discrete functions following bicameral adoption of a bill in Congress. First, he may elect to sign it. Second, he may veto the bill and return it with a statement of his objections to the house of Congress in which the bill originated. Finally, he may do nothing, in which case the bill becomes law without his signature, unless the Pocket Veto Clause applies.

LIVA would give the President a fourth option, permitting him to sign a bill into law but then immediately cancel portions of the bill that he finds objectionable. This new option cannot be derived from any of the President's other Presentment Clause powers.

To be sure, some have argued that the President possesses an inherent line item veto power. These arguments do not withstand textual or historical analysis. The Presentment Clause requires that the President, upon being presented with a bill, "[I]f he approve it he shall sign it, but if not he shall return it with his objections to that House in which it shall have originated ..." The clause requires the President to sign or veto the "Bill." It does not give him the option of splitting the bill into pieces and signing or rejecting parts of the bill. This understanding of the Presentment Clause has prevailed at least since President Washington's first term. "From the nature of the Constitution, I must approve all the parts of a Bill, or reject it in toto." 33 Writings of George Washington 96 (1940). See also 12 Op. Off. Legal Counsel 128 (1988).

Even if such a power could be found in the Presentment Clause, however, it would not support the power described in LIVA. Whatever its scope, the veto power must be exercised before a bill becomes law. LIVA, in contrast, requires the President to act to cancel a bill only after he has signed the bill into law.

The executive power reposed in the President in Article II provides no greater support for LIVA than the Presentment Clause. That power is, to be sure, vast in its scope. But it remains fundamentally executive in its nature. By contrast the power created under LIVA is a power to make law by repealing portions of existing law. When the President signs a bill, it immediately becomes law. That law can only be rescinded by another legislative act. LIVA would place that legislative process in the President. It would be difficult to imagine a clearer violation of the Framers' commitment of the legislative power to Congress and the executive power to the President. Far from executing the law, the President's actions under LIVA would nullify it. (Of course, the legislative act of Congress in adopting LIVA does not justify the transfer of constitutional powers from Congress to the Executive contemplated in the statute. See INS v. Chadha, 462 U.S. 919, 942 n.13 (1983).)

Moreover, by picking and choosing which items of spending or tax benefits he would cancel, the President will be in a position to profoundly alter the legislative compromise that is normally reflected in final legislation. A Senator or Congressman could not be assured that a particular provision which persuaded him to support an omnibus bill will remain in place even after the President signs the bill into law. Moreover, LIVA places the President in a position to exert significant pressure on individual Members of Congress by threatening to cancel individual items of importance to them. Thus the constitutional balance of power between the Executive and Legislative Branches would be drastically altered.

A stronger basis for LIVA's provisions empowering the President to cancel requirements that funds be spent is the so-called impoundment power. Presidents up to and including Richard Nixon asserted an inherent power not to spend appropriated funds to the extent they deemed them unnecessary to accomplish statutory purposes. President Nixon's attempts to expand the use of this power resulted in the passage of the Impoundment Control Act which purported to severely limit the President's impoundment authority. (LIVA is styled as an amendment to that act.)

The basis for a presidential impoundment authority is open to question, particularly in the face of the express, and presumptively constitutional, statutory command in the Impoundment Control Act that all appropriated funds are to be spent. Moreover, even if an inherent impoundment authority exists, it would not require the upholding of LIVA. As discussed above, LIVA authorizes the President to cancel, not only spending authority, but special limited purpose tax provisions as well. The impoundment authority has never been thought to extend beyond rescinding spending. Congress' considered choice not to include a severability clause in LIVA would almost certainly require that the statute as a whole be struck down if the power to modify tax laws is, by itself, found to exceed executive authority.

From one policy perspective, LIVA may represent an important improvement over prior law. The fundamental flaw in the Gramm-Rudman Act and other prior legislative attempts at budget control was that they were actually intended to eliminate accountability from the budget balancing process. LIVA, in contrast, centers accountability for tough budget decisions in the President. Presidents have for many years sought this role. At least until the present administration, however, they have consistently advocated a constitutional amendment as the appropriate means of achieving that accountability. A decision by the Supreme Court striking down LIVA would, perhaps, rekindle the movement to give the President a true line item veto through the only sure means: amending the Constitution.

*Mr. Flanigan served as Assistant Attorney General for the Office of Legal Counsel during the Bush administration. He is currently working on a biography of the late Chief Justice Warren E. Burger.